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Meta-analysis of Energy Innovation System of 40 Countries
Fionn Rogan, Paul Bolger, Brian Ó Gallachóir
BIEE Conference, 22nd September 2016, Oxford, England
39
39 Countries
Argentina Finland Japan Singapore
Australia France Korea Slovenia
Austria Germany Mexico South Africa
Belgium Greece Netherlands Spain
Brazil Hungary Norway Sweden
Bulgaria India Poland Switzerland
Canada Indonesia Portugal Turkey
China Ireland Romania UK
Czech Republic Israel Russia USA
Denmark Italy Saudi Arabia
MethodologyEnergy transition: decarbonize in a generation?
Energy Innovation System
• Policy context
• Legislative context
• Finance & investors
• Business & entrepreneurship
Energy System
• Model technology pathways to 2050, 2100
• Decarbonizationtechnically feasible, but...
• Human
capacity
• Knowledge
• Communities• Society/Values
Different perspectives
• Research focused
• Firm focused
• Changed focused
Different indicator types
• Input
• Output
• Throughput
MethodologyEnergy innovation system indicators
Innovation
• Political, regulatory
& business
environment
• Tertiary education
• R&D
• ICT infrastructure
• Ecological
sustainability
• Credit
• Investment
• Innovation linkages
• Knowledge creation
Competitiveness• Institutions
• Infrastructure
• Macroeconomics
• Health, education &
training
• Goods market
efficiency
• Labor market
efficiency
• Financial markets
• Technological
readiness
• Market size
• Business
sophistication
• R&D Innovation
Entrepreneurship
• Opportunity Perception
• Startup Skills
• Risk Acceptance
• Networking
• Cultural Support
• Opportunity Startup
• Technology Absorption
• Human Capital
• Competition
• Product/Process Innovation
• Process Innovation
• High Growth
• Internationalization
• Risk Capital
Cleantech
• General Innovation Drivers
• Cleantech-Specific Innovation Drivers
• Evidence of Emerging CleantechInnovation
• Evidence of CommercialisedCleantechInnovation
Energy
• Energy Security
• Energy Equity
• Environmental Sustainability
• Political Strength
• Societal Strength
• Economic Strength
Environment
• Health Impacts
• Air Quality
• Water and Sanitation
• Water Resources
• Agriculture
• Forests
• Fisheries
• Biodiversity and Habitat
• Climate and Energy
Research Question 1
Research Question
• Are countries that are ranked highest for economic metrics (i.e. innovation, competiveness, and entrepreneurship) also ranked highest for environmental metrics (i.e. energy sustainability, clean-tech, environmental performance)?
Methodology
1. For 39 countries, what are rankings for six metrics?
2. Convert to rank percentiles
3. Average performance for economic metrics & environmental metrics
Percentile ranking: economic & environmental performance
0%
10%
20%
30%
40%
50%
60%
70%
80%
Swed
enSw
itze
rlan
dU
KD
enm
ark
Fin
lan
dC
anad
aG
erm
any
USA
No
rway
Net
her
lan
ds
Au
stri
aFr
ance
Irel
and
Au
stra
liaJa
pan
Bel
giu
mSi
nga
po
reIs
rae
lSp
ain
Po
rtu
gal
Ko
rea
Cze
ch R
epSl
ove
nia
Hu
nga
ryIt
aly
Po
lan
dSa
ud
i Ara
bia
Turk
eyR
om
ania
Bra
zil
Bu
lgar
iaG
reec
eC
hin
aR
uss
iaM
exic
oSo
uth
Afr
ica
Arg
enti
na
Ind
on
esia
Ind
ia
Perc
enti
le R
anki
ng
Economic ranking Environmental ranking
R2= 0.81
Country categories
• Scoring distribution for:• Economic
• Environmental
• Scoring distribution for:• Innovation
• Competitiveness
• Entrepreneurship
• Environmental
• Energy
• Cleantech
• Are the scoring distributions consistent or divergent?
Country categories
0%
10%
20%
30%
40%
50%
60%
70%
80%
Swed
enSw
itze
rlan
dU
KD
enm
ark
Fin
lan
dC
anad
aG
erm
any
USA
No
rway
Net
her
lan
ds
Au
stri
aFr
ance
Irel
and
Au
stra
liaJa
pan
Bel
giu
mSi
nga
po
reIs
rae
lSp
ain
Po
rtu
gal
Ko
rea
Cze
ch R
epSl
ove
nia
Hu
nga
ryIt
aly
Po
lan
dSa
ud
i Ara
bia
Turk
eyR
om
ania
Bra
zil
Bu
lgar
iaG
reec
eC
hin
aR
uss
iaM
exic
oSo
uth
Afr
ica
Arg
enti
na
Ind
on
esia
Ind
ia
Perc
enti
le R
anki
ng
Economic ranking Environmental ranking
6
7
1
23
4
5
Country Categories
Category Description
1 TOP (consistent) Consistently high scoring or top ranking on all or nearly all metrics
2 TOP (exceptions) Consistently high scoring or top ranking with notable exception of one or two moderate scores
3 MODERATE (exceptions-high)
Moderate rankers with exception of one or two top score
4 MODERATE (consistent)
Moderate rankers with consistent moderate scoring on all nearly metrics
5 MODERATE (exceptions-low)
Moderate rankers with notable exception of one or two very low score
6 CATEGORY DIFFERENCE
Very high economic score with very low environmental score
7 LOW Consistently lowest scorers and rankers on nearly all metrics
Research Question 2
Research Question
• What are the key explanatory variables underlying the innovation, competiveness, entrepreneurship metrics and environmental performance, energy sustainability and cleantech metrics?
Methodology
1. Country categories and individual countries
2. Ranking, scoring and performance for key energy innovation system metrics
3. Cross-check with IEA & OECD energy data
Countries
• Sweden
• Switzerland
• UK
• Denmark
• Finland
Characteristics
• Long-term energy/climate plan
• Limited fossil fuel reserves; higher levels of renewables; often hydro
• R&D budgets more likely to be renewables focused (IEA data)
• Score high for environment; negative health effects minimal
• Technology developers and exporters (not necessarily energy)
• Entrepreneurship scores high; though commercialisation challenges for cleantechremain
• Within-country collaboration levels (university-industry) generally high; international collaboration levels not top ranked
TOP ranking_consistent
Countries
• Canada
• Germany
• USA
• Norway
• Austria
• France
Characteristics
• Less likely to have long-term energy/climate plan
• Most countries significant energy exporters• Partial lock-in from energy tax take high ranking
• R&D budgets slightly more peaky and less likely focused on renewables than top ranking countries
• Environmental scores are high, though some negative side-effects on air quality & health
• Technology developers and exporters (not necessarily energy)
• Very high or top entrepreneurial rankings; not reflected in cleantech commercialisationranking
TOP ranking_exception
Countries
• Netherlands
• Australia
• Japan
• Israel
• Spain
• Czech Republic
• Characteristics
• Tend not to have long-term energy/climate plan• Decade prior to 2011, Japan had a “de-facto” long-term
nuclear plan
• Varied scoring distribution: weaknesses impacting strengths
• Japan & Israel score very differently for entrepreneurship & competiveness
• Low entrepreneurship rankings for Japan severely weaken impact of world leading energy R&D spend
• High entrepreneurship ranking for Israel, especially for cleantech; low for energy sustainability (especially due to absence of a long term plan)
• Netherlands, Spain and Czech Republic all score high for environment, but low for cleantech
• Some countries world leaders in technology development (including, but not necessarily in energy)
MODERATE ranking_exception_high
Countries
• Ireland
• Belgium
• Portugal
• Korea
• Hungary
• Italy
Characteristics
• No long-term energy/climate plans• Policy instability is likely to be high ranking
“problematic factors for doing business” (competitiveness indicator)
• Not energy producing countries (have energy import dependency)
• Consistent moderate-high scoring on economic & environmental metrics
• Some technology exporters, but some successful followers too, e.g. Portugal & Ireland (for wind energy)
• Moderate energy R&D spenders (exception, Korea)
• Korea (similar to Japan), high ranking for patents and R&D spend, but low ranking for entrepreneurship
• Environmental scoring main weakness is air quality with associated health impacts
MODERATE ranking_consistent
Countries
• Slovenia
• Poland
• Romania
• Brazil
• Bulgaria
• Greece
• Russia
• Mexico
Characteristics
• No long-term energy/climate plans
• Likely to be large energy exporters (with associated carbon lock-in from high energy tax take)
• Environmental degradation and air pollution and link to health evident, especially for indoor air quality
• Quality of electricity negatively affecting economy and society; though energy access not generally a problem
• Quality of governance and institutions having a negative impact; corruption rated as a barrier to business
• Partial or negligible cleantech investment; cleantech R&D budgets low or zero (indigenous capacity in terms of renewables very low)
• Entrepreneur scores: institutional lower than individual
MODERATE ranking_exception_low
Countries
• Singapore
• Saudi Arabia
• Turkey
• China
Characteristics
• Countries with large energy reserves (exception, Singapore) with carbon lock-in and high energy tax take lock-in
• Environmental, energy, climate considerations demoted in preference to economic metrics
• Consequences for environment, air quality, health (e.g. child mortality) very negative
• Very little or contradictory investment in cleantech
• Quality of electricity system negatively affecting quality of life
Category difference
Countries
• South Africa
• Argentina
• Indonesia
• India
Characteristics
• All countries have less than 100% access to electricity (75%-94%).
• Negative environmental impacts from lack of • Electricity access
• Technology access (e.g. indoor air pollution from biomass burning)
• Energy access a pressing issue, e.g. Argentina net energy exporter even though 12% of population have no access to electricity
• Lack of access to capital, financial and human
• Quality of institutions and governance poor
• Entrepreneurial indicators: higher for individual than institutional
• Water system/quality also poor
LOW
Conclusions
• Importance of a long-term plan
• Different challenges for different types of countries
• Carbon lock-in
• Role of entrepreneurship
• Governance challenges
Next steps
• Deepen the analysis, continue to sense-check and formalise results
• Extend the analysis of different country types
• Extend the analysis on entrepreneurship within the energy innovation system